Personal spending rose 0.6% in March, after climbing 0.5% in February, which was in line with what economists had been expecting. March personal income also met expectations, growing 0.3% after the previous month's uptick of 0.1%.
The personal saving rate fell to the lowest rate since September 2008 at 2.7%, which PNC Chief Economist Stuart Hoffman said is consistent with a slower pace of consumer deleveraging, but "does remind us that spending growth cannot increase beyond income growth for very long in a credit constrained environment."
Hoffman expects some consumer spending growth from improved home sales in the second quarter but sees more moderate increases in the third and fourth quarters.The Commerce Department said construction spending grew 0.2% in March, after slipping 2.1% in February.
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